Summary of The Permission Problem, by James Surowiecki

The Tragedy of the Commons is a widely accepted concept, accounting for the failure of common ownership. To some extent it helps to explain, for example, why communism failed, stating that, the common ownership of a valuable asset leads to the pursuit of self-interest of the interested parties alone, resulting in the over-exploitation of the valuable asset. In his book, The Gridlock Economy, however, Columbia professor Michael Heller, outlines the antithesis to the Tragedy of the Commons, calling it the Anticommons. Proposing the alternative scenario, Heller argues that if the actual ownership of a valuable asset is divided among a large number of people, more people can veto the use of the valuable asset, resulting in the under-exploitation of the asset. This is the case, for example, in the aircraft industry, the biotechnology sector, or the transport of wind power. Although property rights are designed to encourage innovation and investment, they are thus often likely to "gridlock" a venture. Cooperation among different patent-holders would be necessary to use the asset, but the interested parties often expect unreasonable prices for their valuable shares, making the venture unviable. Strangely enough, it seems that both the Tragedy of the Commons and that of the Anticommons result in similar outcomes, because in both cases the valuable asset turns out not to be of use to any party.